April 23, 2013

Preparing for the summer rental season

The summer season brings plenty of opportunities for rentals. Property managers will know that many owners will be looking for ways to maximize profits during these tough times by renting out their homes. Alternatively, some may just want to let a room out to boost their finances. Doubtless, some tenants may want to flee for the summer – perhaps to escape from the crowds – and may seek to sub-let their properties. This, however, is a very tricky area and depends on the terms of the contract.

So if you manage a whole unit of properties by the sea or in the mountains you will inevitably face an influx of people. Homeowners or tenants who rent out rooms should be aware of the possible dangers of finding people at random, at the local bus station for example. These people may not be the best tenants. You need to persuade them that such a policy is dangerous and that you, as their property manager, are best positioned to manage the process of selection.

Vacation rentals bring new risks of which your owners may be unaware. Tenants who just stay in a property for a couple of weeks for a seaside holiday may not take the same care as long-term tenants. Holidaymakers fresh from the beach may leave a trail of sand and oil around the house. They may even have a party and trash the place! Screening tenants in advance, no matter how short the duration of their stay, is vital.

In the summer you will have to ensure that the air-conditioning is working properly and that the place has been well aired and ventilated before holidaymakers arrive. You will also have to advise homeowners who are renting out their holiday home that there could be insurance restrictions depending on whether it’s their first or second home. Homeowners may be wise to purchase additional liability to cover risk when they are not at home. Be aware that homeowners’ coverage might not extend to damage caused by a renter and/or their guests. You will need to advise them to read the policy carefully to ensure coverage meets their expectations. Be aware also of insurance issues if the tenants in your property agree to swap (a particularly trendy activity these days) with other tenants they have befriended elsewhere. Does the insurance policy cover them? Are your clients all covered by insurance?

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Keeping cool in the heat

Be aware that people will still expect high standards even if they are vacationing for a couple of weeks. Faulty air conditioning, a freezer that functions poorly, inadequate space in the refrigerator for drinks, poor water quality, no mosquito netting in the windows – all these things have the potential to ruin someone’s holiday. Be aware of the area surrounding a holiday residence. Over-grown and smelly rubbish areas (particularly in the summer) can all cause problems. If the residence is too near a noisy bar, then this can also cause much distress.

The kitchen will have to be well equipped. Many holidaymakers increasingly find that hotels offering all-inclusive holidays are actually cheaper once all the extras of a rented apartment – including the cost of self-catering and/or eating out – have been factored in. This is why the holiday apartment or home has to be in tip-top condition and a good kitchen and bathroom are essentials.

It’s a good idea to take proper photographs of everything in the residence before any summer holidaymakers arrive. Then take a photo on the last day when the tenants leave to avoid arguments about who was responsible for mess and breakages. Remember to take an inventory of everything in the home. If you clients are renting out their house for summer rentals, you need to establish in advance whether items like beach chairs, parasols and barbecue grills (perhaps tucked away) are all part of the deal.

A deposit will be required up front. Also, particularly with summer holidaymakers, who may well make a mess, be aware that a cleaner may be required. You will have to liaise with the owner in advance to decide on what basis the cleaner comes in and who bears the cost.

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